SÃO PAULO--(BUSINESS WIRE)--Banco do Brasil, Brazil’s largest bank, and Banco Lemon have entered into a partnership whereby Banco do Brasil expects to expand its Correspondent Network countrywide by 70 percent. In the partnership model adopted, companies that presently have correspondent contracts with Banco Lemon may contract with Banco do Brasil directly. Such contract grants Banco do Brasil exclusivity in the correspondent business with those companies. Thus, Banco Lemon will no longer operate in the correspondent business directly and will focus its efforts on the corporate credit area, a segment in which it has been investing over the last three years, with emphasis on corporate credit, middle market and structured transactions, aiming to originate more than R$200 million in credits by the end of 2009.
This business may imply the migration of nearly 6,500 correspondents to Banco do Brasil, strengthening its presence in more than 1,500 municipalities throughout Brazil. This partnership will also contribute to expand customer access to banking services and, in addition, it will make the services provided by Banco do Brasil easier and more convenient to use.
This initiative reinforces Banco do Brasil’s strategy to expand its market share in the D and E customer classes, which are called “emerging markets” by the institution. In 2008, Banco do Brasil had already incorporated the operations of Banco Popular do Brasil, which also focused on microfinance business, and this resulted in the integration of the subsidiary’s correspondent network.
Initially, the correspondents that will be contracted by Banco do Brasil will continue to provide services for the payment of sundry accounts and bank bills and will. The correspondents will now also make payments to INSS beneficiaries who receive their pensions through Banco do Brasil. They will also be able to operate in consigned credit and it is expected that they may make available, at a subsequent time, statement and current account withdrawal services.
Banco Lemon started its activities in 2002, operating exclusively through correspondents in the offer of sundry payment and receipt services. Its operational strategy is based on the provision of banking services to the low-income population.
Banco do Brasil started its operations with correspondents in 2001. In 2004, it implemented the Popular Bank of Brazil (BPB) based on the exclusive use of correspondents. In 2007, it strengthened its network by entering into a partnership with Visanet. In 2008, after the integration of the BPB network, Banco do Brasil Correspondent Network reached about 10,000 points. The outlook for 2009 is to have more than 17,000 contracted correspondents by December. These correspondents will adopt a new and common brand, soon to be launched, in their signage and in their communication with customers.